NPLs of housing finance down 12 percent in July-September

Non-Performing Loans (NPLs) of housing finance shrank by 12 percent during the July-September 2016. The total number of borrowers classified as NPLs also declined to 35,105, out of total 65,830 borrowers. According to State Bank of Pakistan (SBP), NPLs of housing finance portfolio decreased to Rs 11.28 billion as on September 30, 2016 compared to Rs 12.75 billion on June 30, 2016, depicting a decline of 11.54 percent or Rs 1.47 billion.
During the period under review, NPLs of House Building Finance Company Limited (HBFCL) remained unchanged at Rs 4.1 billion over the quarter. Furthermore, HBFCL percentage share of NPLs, in its total outstanding amount, decreased by 7.94 percentage points over the year. At the end of September quarter, 28.04 percent of HBFCL gross outstanding amount constituted NPLs and in terms of percentage its share in total NPLs was 36.35 percent.
Among banks, NPLs of Islamic banks decreased to Rs 1.43 billion during the year. While, NPLs for Islamic banking industry (Islamic Banks and & Islamic banking Departments of conventional banks), were remained unchanged over the quarter and stood at Rs 1.83 billion as on September 30, 2016.
Their NPLs of housing finance constituted 12.68 percent of total industry NPLs. NPLs of the public sector banks decreased by 43.18 percent to Rs 1.25 billion, over the year, and remained 28.04 percent of their gross outstanding portfolio at the end of the quarter.
Private Banks'' NPLs of house finance portfolio decreased by 13.84 percent to Rs 4.42 billion end of Sep 2016 down from Rs 5.13 billion in June 2016. NPLs of other financial institutions decreased to Rs 0.05 billion over the year.
The break-up of NPLs with respect to size of loans during the current quarter, Rs 3.64 billion, against 33,007 borrowers was recorded as NPLs in the category of ''Up to Rs 1 million''. In the category of ''Above Rs 1 million to Rs 5 million'', total NPLs amounted to Rs 2.87 billion with 1500 borrowers. In third category ''Above Rs 5 million'', total NPLs were Rs 4.77 billion against 598 borrowers.
The break-up of house finance NPLs in terms of gender showed that 88.21 percent of the total NPLs belonged to male borrowers and remaining 11.79 percent to female. The break-up of NPLs in terms of income source reflected that the major chunk of NPLs, ie, 54.68 percent, was associated with salaried individuals, 30.15 percent with business borrowers and 15.17 percent with self-employed borrowers.